- Associated Press - Friday, December 26, 2014

ANCHORAGE, Alaska (AP) - Alaska’s legislative leaders are calling in Gov. Bill Walker to immediately address budget worries brought on by the falling price of oil.

Legislative leaders called for a hiring freeze in all departments, limits on state employee travel and an accounting of spending through the fiscal year’s first six months to determine if agencies have resources that could be reduced.

In a letter dated Tuesday, Senate President-elect Kevin Meyer, House Speaker Mike Chenault and the co-chairmen of the House and Senate finance committees said the most critical issue before the Legislature is Alaska’s long-range financial outlook.

“The immediate concerns of a $3 billion deficit and our ability to protect the state’s credit rating from damage and deterioration will take center stage when the Legislature convenes in January,” they wrote.

Walker spokeswoman Grace Jang said by email Friday that Walker appreciated the letter and shared a concern for action. Walker and his budget team have been in almost daily meetings, she said.

“He will ask commissioners, state employees and the public to weigh in on where we should make cuts,” Jang said.

Walker on Dec. 15 submitted a stripped-down capital budget as a starting point for addressing the bleak revenue forecast.

The state is projecting a $3.5-billion budget deficit for the current fiscal year, which ends June 30, amid lower-than-expected oil prices. The state project a $3.2-billion hole for 2016 even at the levels laid out in reduced budget submissions.

Walker’s operating budget, required to be submitted by Dec. 15, was prepared by his predecessor, former Gov. Sean Parnell, and Walker has not endorsed it. After collecting suggestions from the public, he plans to submit revised spending plans by Feb. 18.

The legislative leaders called for changes to be made sooner.

“Once the gavel falls on January 20, we have 90 days for consideration of the people’s business,” they wrote. “Both Houses of the Legislature consider the fiscal crisis as our top priority.”

The legislative leaders asked Walker to preserve essential services and critical statewide projects, including natural gas line projects, while identifying possible reductions in discretionary agency operations.

They also called for a review of capital appropriations made more than five years ago that have not moved forward to determine if the money can be spent elsewhere.

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